This past Saturday, during his visit to Milwaukee, Vice-President Pence vowed to repeal and replace the Affordable Care Act (ACA, also known as Obamacare) by the end of the summer. He acknowledged that achieving this will be difficult and that "we’ve got our work cut out for us."
That said, repealing and replacing Obamacare by the end of the summer doesn't necessarily mean that all of the American Health Care Act's (AHCA) provisions will be in effect by the fall.
The GOP promised a smooth transition for repeal and replace and thus there will be delays built into the AHCA. This does, in fact, extend the length of Obamacare’s effects on the market, but this is necessary to avoid market shock. That underscores just how important it is that the Senate present its version of the AHCA as soon as possible, as allowing it to go beyond the summer recess would mean it might not be passed until next year.
With that in mind, below is the scenario that may play out as the timeline for the AHCA, from getting it passed to when some of the repeal measures will be in effect.
Currently, at the moment of publishing this article, we're waiting on the Senate's own draft of the AHCA. When the Senate received the bill from the House in May, they could have passed it as it was, but Republican Senators stated they would be drafting their own version. Usually, this would mean that after the Senate drafts their version of the bill, it would go to a conference committee between the two chambers. Not this time.
Last Wednesday, Sen. Mitch McConnell, R-Ky., implemented Senate Rule 14. The rule fast-tracks the bill, avoiding the conference committee process altogether, placing it directly on the Senate calendar for a vote. Rule 14 implemented with reconciliation would allow the GOP to pass the AHCA very quickly.
This speaks to why Vice President Mike Pence's comments from Saturday are interesting. All recent indications show the GOP's strategy is to use reconciliation. Reconciliation is a process that allows a bill to be passed filibuster-free with only 50 votes, with the vice-president casting the vote that passes the bill onto the president.
One can wonder if Pence is signaling that he will support the AHCA if it comes to reconciliation with 50 count vote in the Senate. If this does happen, President Trump will surely sign the AHCA into law.
That doesn’t mean that all of a sudden everything is going to change. The market buffers that will surely be built into any repeal bill that the Senate comes out with are likely to take place within a two-to-four year period. As for the rest of this year, lawmakers have no control over how insurance will be affected as contracts and agreements until the end of the year have already been signed.
Healthcare in 2018, will largely depend on the replacement aspect of the AHCA and other additional activity taken by the president and Congress. If the Senate’s new version is anything like the House's old bill, those who purchase insurance from Obamacare markets and independently will see the most changes.
Those who receive health insurance through their employer or Medicare are likely to see less significant changes from the repeal.
When the Senate's version of the AHCA comes out and is likely signed into law by President Trump, you can expect to see our detailed analysis of its implications for employers, employees, and those buying insurance individually.
Richard S. Bernstein, CEO of Richard S. Bernstein & Associates, Inc., West Palm Beach, is an insurance advisor for high net worth business leaders, families, businesses, municipalities, and charitable organizations. An insurance advisor to many of America’s wealthiest families, he is a writer, trusted local and national media resource and expert speaker on estate planning and health insurance. Visit his website at www.rbernstein.com. To read more of his reports — Click Here Now.
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